Myths, Dangers and
Sustainability
There is little doubt that streaming content over the
internet has changed the face of media, in fact of all the arts and
entertainment community, drastically, intuitively and forever. Streaming services such as Netflix, Hulu,
Amazon Video, as well as broadcast and content sharing platforms such YouTube
and Vimeo, have altered not only the way media is distributed, but how and by
whom it is produced.
With almost every cable network or broadcaster having
a significant presence on one or more of these services, as well as the trend
toward creating individual streaming or web casting apps, there can be no doubt
that the Internet is the broadcast media of today and tomorrow.
Combined with the way more consumers are watching
media, listening to music and even purchasing goods and services, it would seem
that web streaming is going to revolutionize the arts and entertainment
industry in ways yet to be discovered.
But, it is sustainable? That is a question that is being asked more
today than ever in the early days of this digital content revolution.
Even as media giant and entertainment mega-corporation
Walt Disney set to jump on board the digital streaming band wagon, the relative
lackluster performance of services such as CBS All Access and the DC Universe
streaming app, as well as the notable losses that individual apps are already
causing in streaming giants such as Netflix, it would seem that the question of
long term stability and sustainability is the most important question, if the
technology and its applications are to be mainstays of the industry someday.
What do the losses and trends say about this? Well, it would seem that we must look to the
entirety of this century-plus- old industry to learn what will be needed to
carry the streaming content craze to its next phase.
First, we must examine some ideas that are long known
and little studied, such as the most unreliable source of revenue for media
producers and distributors, which has always been that from the media consumer
individually. Media consumption patterns
do not consistently match consumer spending patterns or economic health. In fact, it is arguable that downturns in
economic health often create a greater demand for media content, which, due to
the circumstances, cannot be afforded by media consumers. Because specific general health, staple and
lifestyle are prioritized by the mass of consumers, these often become the most
reliable and long tern providers of revenues.
Soap and food products have been the longest and most stable sources of
funding for media producers and distributors.
The only successful content media delivery and content
production service to rely directly on media consumers has been the Cable TV industry,
which in no small part is due to streaming and Internet content providers
failing through attrition. While this
industry flourished in its early days due in large part due to its ability to
deliver greater quantities of varied content directly and reliably to
consumers, it’s reliance on these consumers for revenue has led to greater
competition and the reliability of the Internet has become more
sustainable. It has also seen greater
competition from within its ranks as many Cable TV stations and Channels are
jumping headlong into the streaming game, and some streaming services have
consolidated their services and agreements with content producers to form ad hoc
cable services such as the Hulu Live Streaming Service, which is arguably a
direct challenge to cable TV providers.
In this way, streaming underdog Hulu, through this
latest Hulu Live venture, may be ahead of the curve. This lead can only remain or become a viable
avenue for other services if content producers and broadcast distributors
remain committed to such a radically “mundane” model. While prudence might dictate this, it
requires a commitment to the tenants that have made media casting successful for
a century, and in acceptance that it is counter intuitive to dry up the
individual financial wells of consumers.
Because Cable TV was in and of itself a single service
based industry, it is easily the first target in the streaming wars of this
decade.
To produce a multi-tiered and sustainable content
creation and delivery mechanism using the internet, it is necessary to look to
the earliest models of broadcast and content production to recreate the fervor
that has been longest sustained through Depression, Recovery, Recession, and
Prosperity in full measure.
Understanding that the media consumer is the least
reliable revenue source, and that staple providers and other commercial
entities are the most stable and sustainable sources of revenue, they are a
mainstay of the industry that has long withstood the changing
technologies. These advantages are
already, in fact, built into the Internet and its wide range of services. Youtubers, for example, rely heavily on ad
revenue to produce content and to distribute it.
Hulu, hase even its paid Hulu Live service, which relies
heavily on ad based revenue to off-set the need for higher rates that would
force it to compete directly with long established cable TV providers.
Even cable TV providers knew that this kind of revenue
was needed if long term stability was going to be created, thus as cable prices
often fluctuated in their 50 year run as the top of the entertainment
distribution food chain, advertising revenues remained a staple of
stability.
To see streaming and Internet delivery and production
succeed in the long term, it is going to be necessary to reduce the costs to
media consumers while increasing the revenues collected to both create and distribute
media, and for more than a century, manufacturing, retail and production
companies have been the single most sustainable source of funding.
The answer may be simple, but hard to hear for millennial media execs. Stop trying to sell already financially strapped
consumers, already established as the least viable revenue sources, new media services which promise only to take content away from one
service to redistribute them through another, when the answer to the question
of long term sustainability is answerable by studying the history of the industry
more closely and seeing what has been plain for a century: Sell advertising to those whose products,
services and creations are viewed as necessary and whose sales are inevitable,
whose concerns are not for survival of a product but for achievement of greater
market shares.
This is the way from which new media content can be
best produced, distributed and profited.
It is the way to a sustainable streaming and webcasting industry that
will last as long as the top 3 true broadcasting companies, ABC, CBS and
NBC. It has been their market strategy
from inception and even amidst cable TV intrusion, it sustained the industry.
Just an observation from a guy not any brighter than
you!
